Is Obama Health Care Plan Good For Businesses?
Bill Warner Tuesday, July 28, 2009
All we are hearing about on the news is the Obama healthcare plan. He makes promises. Congress makes promises. Reporters explain what it all means. None of it seems to come together as a consistent and complete story. However, there are some indicators that are really worrisome for businesses. All small business owners and employees of small businesses need to become pretty familiar with what may happen to healthcare and what it will mean to them. The best source is to go read it yourself. I ran across an article in economicpolicyjournal.com that picks out some sections you should look at. Quite frankly, the plan document is shocking. Most people don’t see this stuff and trust what they hear from politicians and news reporters. I suggest you read for yourself, form a position, and then let your legislators know what you think, based on an informed view of the plan as written.
Small business implications
This bill has significant implications on small businesses, and could impact operating costs and prices. Here are some of the things to look for:
- Employers must auto enroll employees into the public plan option. So much for choice. If an employer doesn’t enroll employees, they will be levied a significant tax on their payroll.
- Employers must pay for the health care of part time employees. This is a huge incremental expense for businesses.
- Healthcare will be provided to illegal aliens. They get it now, but now it is official, and businesses will pay for it.
- The government will audit the books of employers that self insure. This could cost over $10,000 for a small business in accounting fees.
- The government will have direct access to your finances and bank account for electronic funds transfer to make payments. This seems pretty intrusive.
- Special consideration will be given to unions, putting more pressure on employer support of unionization.
- The government will create and exchange of health care providers which will mandate their coverage and put them under government control. This further reduces the choices for employers.
- Employers will not be able to sue the government, like for price fixing. They have thought of everything for this health care monopoly.
Implications for employees
Employees may not be too happy either, once they discover what they get for the allegedly reduced health care cost. Here are some things they could be concerned about:
- There will be a government committee that decides on what treatments/benefits that will be provided.
- Employees will not be able to selectively pay for health care procedures themselves. Every person has the same healthcare services.
- Health care will be rationed. This helps the government reduce cost, but at the expense of choice and quality of care. Employees need to read the fine print on this one.
- Employees approaching retirement age should worry a lot about this plan. It looks like the government will manage your lives all the way to your death.
- Doctors pay will be managed by the government. This will have a devastating effect on quality of care, as more and more doctors leave the business.
What can we do about this?
Of course there is still a lot of debate that will be held on these health care plan alternatives. I urge every small business owner to read the fine print in the bill and decide for yourselves whether or not you support it. Then, contact your legislators and tell them what your position is.
The content of this bill is truly depressing. We are not being told the truth about it. Sure, there is a health care cost problem in America, but this bill has us throwing out our whole system and replacing it with a “one size fits all” exclusive health care plan run by the government.
The health care cost problem can be addressed by some focused initiatives:
- Find the waste in the system and eliminate it.
- Eliminate fraud which amounts to over $200 billion per year.
- Institute tort reform for malpractice suits against physicians and hospitals
- Computerize the health care system which will eliminate mistakes as well as fraud
- Provide tax incentives for health care investments as well as incentives for providing broader coverage
- Encourage best practices in being healthy and provide incentives to those people who are healthy
It escapes me why our representatives in congress think that this health care bill is appropriate for solving the problems that face us. I think it is entirely inappropriate. After reading it, you may too.
Filed Under: Business Operations
Bill Warner is the Managing Partner of Paladin and Associates, a business consulting firm in the Research Triangle Park area of central North Carolina, and is the Chairman of the Triangle Accredited Capital Forum, an angel investor network with over one hundred members throughout the southeast.
Bill Warner is the Managing Partner of Paladin and Associates, a business consulting firm in the Research Triangle Park area of central North Carolina, and is the Chairman of the Triangle Accredited Capital Forum, an angel investor network with over one hundred members throughout the southeast.
Thanks Bill for a truly insightful article. I am posting this to facebook as you read this.
Bill,
Thanks for this recap. I have expressed my concern about the plan in general our Senators and my House of Rep. After reading your recap, I will complain more specifically.
for those who can make it
A patients First Campaign
10am Wednesday at North Raleigh Hilton
This is very scary. If this passes in the form you describe I (and all other companies that provide contractors for staff augmentation) will be forced to file bankruptcy. There is no way that our current fee structure, with continually shrinking margins, will support providing any funds for healthcare coverage for our contractors. We have difficulty paying the ever increasing health insurance premiums for ourselves, as we have no group buying power. And the companies that use us do so because of the reduced overhead that results from no benefits for the contractor. They will also be impacted with fewer places to find quality people and will be forced to hire more direct hires for key jobs which will increase their costs which will increase their prices (or reduce their margins) both of which are bad for a recovering economy. Canada is looking better and better.
Thanks for the thoughtful comments and referrals.
I urge everyone to take a hard look at this bill, not just news reports and speeches from politicians. Read what it actually says. It should concern you deeply and make it clear that you need to tell your legislators what you think about it. I am not an activist, but this one drives me in that direction. It’s frightening.
Bill Warner
Bill, this is great. I agree with everythng except the tort reform suggestion. I believe that patients must be able to sue when a medical professional’s mistake causes irreparable damage. Our challenge is to find the balance that eliminates the frivolous suits but still leaves legal recourse for justified situations. Of course, ‘justification’ could be very subjective. 
Bill,
I personally do not believe that there is any question about it - this bill WILL be very bad news for business, especially small businesses.
The bill is a “camel’s nose under the tent” first effort toward a European or Canadian style national health system. While some reforms are necessary, the first step is to defeat this bill so that we can have a more balanced discussion.
Tort reform shouldn’t eliminate the right to sue for malpractice, but should limit the damages that can be claimed and establish with more specificity what an act of malpractice is.
Bill Warner
Thanks Bill, you make several good points, and I will take the time to try to read as much of this bill directly as I can and time allows me. I am so sick and tired of being told what to think about this bills from every pundit under the sun..
I do own a small business and I did have to drop insurance from my people because I WAS going broke with the existing system. So, any kind of a solution that tells me that somehow the existing mess will work when insurance companies can get a better incentive to be good citizens and avoid waste and fraud, I am from “Missouri”!
Any fear tactic that says the doctors will start running away and we will have a shortage of doctors, I do not buy! Like our programmers, doctors are plentiful over the world! Lets start bringing them in! I have to believe that we are not the only country that has good doctors and medical schools.
Leaving part time employees and contractors to fend for themselves, is what is happening today and it is not “pretty”. Letting the emergency rooms take care of them including the illegals, throws the economic burden on the middle class as it does today.
So, as far as I am concerned, the existing system is broken. No little fixes here and there will help it. When my business was going under, I had to take major tough, painful steps to keep it going again and I did it. It took me a year and a half , but I did it. We can do this too.
What I find disheartening is that health care is such a political issue and we cannot seem to get the politicians in Washington to focus on solving today’s health problems for the country vs, next year’s elections!
Despina Boinodiris
Your report on the new health-care plan really doesn’t say anything except obviously it’s very different than what we currently have and there was not much thoughts given to the implementation of the plan. It’s a rush job.
I would suggest that he was government take a look at the German healthcare system which is working quite well and they’ve had at least 50 years to refine it. A lot to be learned from the German healthcare system.
Sincerely,
Bert Robinson
